China’s Answer to Craigslist: 58.com

On Thursday, Chinese e-commerce site, 58.com Inc., will list on the New York Stock Exchange to raise up to $150 million in American depositary receipts. The site, commonly known as the Craigslist of China, has grown popular in the mainland since its creation in 2005 as a one-stop site for listings of rentals, job offers, second-hand goods, and classifieds. The company has an average of 129.7 million monthly unique visitors to its website and posted a net profit of $300,000 on revenue of $58.8 million in the first half of 2013, according to its prospectus filed with Securities and Exchange Commission.

Though it has drawn comparisons to Craigslist, 58.com’s similarity to the U.S. site ends at the listings. Unlike in the U.S. and other Western countries where Craigslist operates, many small and medium enterprises in China’s smaller cities don’t yet widely use the Internet for business. As a result, 58.com runs offices in 26 different Chinese cities, making use of a local presence to train vendors in local environs on how to use its site. The company then sells the vendors memberships or other marketing packages, which give listings a special priority at the top of different sections of the site.

For growth, the company is counting on increasing numbers of China’s myriad small business owners to use the Internet more, and in turn 58.com, to sell goods, hire staff and maybe even look for a date.

Though it has had success, the company faces potential competition from larger players that specialize in parts of its business. Potential competitors include Alibaba Group Holding Ltd., which runs a marketplace that sells a vast array of goods including second-hand ones, or 51job Inc., which runs job ads for companies across China.

Though by no means one of China’s largest Internet firms, the company’s IPO has raised attention among investors and Chinese tech players alike, as a strong performance could open the way for a number of other Chinese Internet firms to list soon.